Online surveys and social-media information have become the de facto research tools of the digital era's fast-moving small businesses. Proponents say such surveys — which used to require a lot of time and money — are now cheap, quick and do-it-yourself online.
That's driving a growing industry for online surveys, which last year climbed 4 percent from 2010 to $2.4 billion worth of business in the U.S., according to industry tracker Inside Research. In fact, the online survey space is crowded with other players, including SurveyGizmo, Qualtrics and Google Consumer Surveys.
Happy Goat founder and "chief executive goat" Michael Winnike, 29, wants to expand his caramel business beyond its roots in specialty markets and figures not everyone in the U.S. will pony up for feel-good caramel just because it is not subjected to pesticides, growth hormones or antibiotics.
The company, which also has an online store, wants to grow from an estimated $250,000 in sales this year to about $1 million in the next 18 months, and boost its distribution presence from 500 retail stores to 2,000. Winnike is counting on customer surveys, in part, to help guide that expansion.
"It's given us access to information that we wouldn't get by other means," says Winnike. That data, he says, will help Happy Goat determine which retail chains should carry its caramel. "Unless we can get our product to a price point and packaging point that can service those chains, we'll never get in those places."
Survey results also showed Winnike that shoppers care more about the flavor and quality of his confections than his caramel's use of organic and all-natural ingredients. "Play up the premium and the flavor and quality — that's what it's telling us," he says.
Happy Goat is just one of hundreds of small businesses using SurveyMonkey to glean valuable customer data. Founded in 1999, SurveyMonkey has 14 million registered users. Members can create survey questions to quickly post on blogs, websites, Facebook or Twitter. "You're creating the data and analyzing it," says SurveyMonkey CEO Dave Goldberg. "It's a really big space helping people make decisions."
Men's clothing website Bonobos, like Happy Goat, has relied on customer input to build its business. Bonobos, launched in 2007 as a company committed to eliminating "khaki diaper butt" from men's pants, specializes in using customer feedback to design better-fitting clothes.
In the old world of men's couture, apparel makers hired fitting models to check measurements. But Bonobos turned to Provo, Utah, start-up Qualtrics to provide online surveys so that it could ask people about their sizing preferences.
"From the beginning, having a customer dialogue has been a huge part of our growth," says Craig Elbert, vice president of performance marketing at Bonobos. "Our core DNA is we want to have a better fitting for guys."
Bonobos worked with Qualtrics to survey "regular guys" for their feedback on top of using fitting models for trimmer shirt designs. "We're essentially letting them into the design process — that's different from the typical apparel industry."
"We would ask things like, 'Do you wear your shirts untucked?' Or 'How many buttons do you leave undone?' " Elbert says.
All the feedback gathered is then provided to their technical designers.
"The other piece we get is marketing language of how to describe that shirt," he says, because customers often give similar descriptions of a product.
"We've made research quicker and easier to do, and put it in the hands of the small marketing team," says Qualtrics CEO Ryan Smith. Now small businesses can "interact with the customer in a way that's not expensive or lethargic."
Online surveys can even be used for broader strategy planning. "If a company was trying to figure out this Pinterest craze, they could do it on the cheap," says Forrester analyst Roxana Strohmenger, referring to the social-networking site for images. They could ask: "Has my audience changed in its reception to Pinterest?"
Small businesses are learning from big companies, such as Starbucks , the value of mining social media, too. In fact, information learned from social media may be more accurate in some aspects than surveys, which some see as the old method for getting to know customers.
The coffee behemoth taps into customer ideas with its website My Starbucks Idea, powered by Salesforce.com , that asks for ideas, then lets people vote on them.
The java giant has drummed up different flavors of drinks and turned criticism of watered-down coffee into the launch of a stronger brew by listening to its customers, says Forrester analyst Zach Hofer-Shall.
Small businesses find tapping into social media particularly attractive because it can take the place of more expensive and time-consuming forms of research and development.
Broomfield, Colo.-based Webroot is using social elements in its Web- and app-based security service to understand customers and serve them better.
"People can submit ideas for the product. Other people can comment on the idea and people can vote on it," says Catherine Buzzitta, manager of community and social programs for Webroot.
These ideas then are submitted to the product team at Webroot, and "quite a few have been implemented," says Buzzitta.
Monitoring what people are actually saying on social media can provide a more genuine reading of sentiment, says Hofer-Shall. Often, the questions asked in surveys — and how they are asked — can shade the respondent's replies. "The value of these unsolicited comments in social media is you hear what they want — rather than what you want them to want," he says.
Some companies are using social-listening tools to ransack rivals' customers.
Aquasana, a home water filtration company with about 60 employees, has researched the social-media interactions of its competitors' customers, including those of rival Brita. Aquasana has tapped social-listening tool NetBase to collect what people are saying across Twitter, Facebook, news sites, blogs, message boards and just about anywhere there's online conversation.
The company's goal: "To find out what people did or didn't like about our competitor," and create campaigns to steer business to Aquasana, says Courtney Turner, the former social-media and community manager at the company, which is based in Haltom City, Texas.
"Never before have marketers been able to really know what consumers think about all of their competitors in real time," says Lisa Joy Rosner, chief marketing officer of NetBase.
Twitter, for example, is seen as an early warning mechanism for companies that might need to do damage control when their products or services go awry. And some small businesses use social-media-monitoring tools from the likes of Salesforce-owned Radian6, NetBase, Attensity or Lithium to monitor Twitter as well as Facebook, Yelp or other social destinations full time for that purpose.
The goal is to intercept those consumers that kvetch. "They need to know what people are saying out there and to react and fix problems before they get bigger," says Hofer-Shall.
Lithium's social-listening tool allows customers to monitor interactions on Twitter and other sites, prioritize problems and set up a response system. If somebody "tweets something about a bad experience, then an agent will come back via Twitter" to try to address the problem, with answers, says Lithium CEO Rob Tarkoff.
For smaller companies, price and speed of response are key considerations. It's relatively inexpensive to monitor social-media communications and respond quickly, compared with establishing a call center.
Some companies, such as GPS maker TomTom , go so far as to turn their social communities into crowd-sourced customer support, essentially encouraging their online users to help others with tech problems.
Caramel maker Happy Goat is slowly ramping up its social-media presence. It has a Twitter feed and a Facebook fan page to promote products. Deals on its caramel get promoted on Facebook. Overall, the company would like to expand its social-media efforts.
But founder Winnike doesn't expect to have to put out public relations fires on Twitter. "It will be for giving stuff away for free and it will be where to get it. Candy, we take it seriously, but it's fun."
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